December 30, 2014

History and economic laws

Comment on 'Mainstream macroeconomics distorts our understanding of economic reality'

• You write: “... the greatest disappointment of the past hundred years has been social science; there is no science in it.” True. I have cited Feynman multiple times  characterizing the social sciences as cargo cult sciences. See also my post of Nov 29: “Psychology/sociology/philosophy are out of science.” I should have added history.

• From this follows that economics has to get as far away as possible from the social sciences. In Update1 I stated explicitly: “Economics is not about human behavior but about the behavior of the economic system.”

• From this follows in turn that a paradigm shift is necessary. The shift consists in replacing the behavioral axioms of Orthodoxy by structural axioms. There is no way around this.

• It is not the sole task of Heterodoxy to kick the dead horse (Ergodicity -- the biggest mistake ever made in economics). The main task is to develop the NEW paradigm (without ergodicity, without closure, without a well-behaved production function, without utility maximization, without supply-demand-equilibrium, without determinism, and so on).

• The biggest mistake in economics is that the profit theory is false since Adam Smith.

• From the fact that historians are no scientists does not logically follow that economists cannot be scientists.

• There are laws in economics, e.g. the Profit Law

• Reading my paper “The Synthesis of Economic Law, Evolution, and History" URL could help you to avoid argumentative mistakes.

Egmont Kakarot-Handtke